The advance of cloud economy presents an entirely new set of challenges, many of them connected to cloud spend. How much do you spend on cloud? How much of it is necessary? How much can you reduce it by improving cloud efficiency? However, the most important question might be this: who is responsible for managing your cloud cost and optimisation?
Does your company really need a FinOps team?
Dean Misic, Product Manager
The answer to all these questions lies in achieving a successful finance practice. Contrary to what some might believe, you don’t need a considerable cloud cost or millions on your cloud bill to reach this goal.
State of FinOps 2021 report reveals the trend of mainly larger companies adopting FinOps. Meanwhile, experts recommend that every company or enterprise should start implementing FinOps practice as soon as possible, regardless of their size.
State of FinOps 2021, 70% of respondents come from large organisations.
Crawl, Walk, Run
The concept of Crawl, Walk, Run in FinOps defines the gradual approach of implementing the methodology. Every enterprise needs to go through a series of learning processes in order to achieve maturity. As the FinOps book states: “There is no shortcut to becoming a high performer”.
Experienced FinOps practitioners recommend starting small and building up your FinOps practice. Every time you reach the next level in your development of maturity, circle back to your data to find more ways to evolve your practice. This will enable you to get greater insights into your cloud. The end goal is to be a high performer with automation implemented into every process of your FinOps practice.
Those of you still in the Crawl stage, rest assured. The FinOps report shows that even among avid FinOps practitioners, there aren’t many high performers – Runners. Cloud is complex and requires time to automate all its key capabilities and processes.
State of FinOps 2021, Crawl, Walk, Run.
The FinOps Mindset starts with One
FinOps adoption commonly starts with one person who is driving the implementation of tooling and processes. However, there are many challenges in implementation which can be only solved by involving the right people and teams across the enterprise. To increase the rate at which your company transforms, find other individuals interested in FinOps. This will make the beginning of your FinOps team.
FinOps Foundation, FinOps Team
The Structure of a FinOps Team
A FinOps team is composed mainly of executives and DevOps engineers, along with people who work in Finance and Procurement. In reality, here is how diverse a FinOps team can be. The State of FinOps 2021 Report indicates that most FinOps practitioners report to a technical executive, mostly to their CTO (31.38%) & CIO (26.82%), followed by CFO, (12.41%), with a mix of ‘other’ responses including COO and Procurement. About 32.75% are part of dedicated FinOps teams, and 43.56% report that their FinOps team is a part of a greater Cloud Center of Excellence.
State of FinOps 2021, Roles and backgrounds of FinOps practitioners
As you grow and your FinOps practice matures, providing you are doing FinOps right, you will see your team of FinOps ambassadors grow. Just look at what is happening with FinOps teams according to State of FinOps 2021: “Respondents on average have about four people on their team dedicated to FinOps and […] expect this number to double! Our analysis also shows teams growing 47% from last year and expecting 75% growth next year.”
State of FinOps 2021, FinOps teams grow
The Fifth FinOps principle
“A central FinOps team drives best practices through standardisation, education, and cheerleading. That same team can centralise rate optimisations to take full advantage of them, while empowering the rest of the team to maximise usage optimisation.”
O’Reilly Cloud FinOps, J.R. Storment & Mike Fuller
One of core FinOps principles teaches us that a centralised team drives the implementation of methodology. This central group drives the rules of cost allocation and keeps everybody in the loop on how teams are doing. These clear lines of communication have the purpose of reassuring everyone that everything is being managed successfully, and the
If you divide your cloud reporting process among two individual teams, disagreements arise about cost ownership. To solve this and other issues, a centralised team will ensure that the spend data is correct, enabling to allocate (attribute) cost to the appropriate engineering team.
Take a look at other issues that FinOps teams face.
State of FinOps 2021, What challenges do FinOps teams face?
We are all FinOps Ambassadors
Everyone in the organisation has a part to play, from finance, operations, development and C roles. However, there is a special place and mission for the Ambassadors. Who are these ambassadors, you may ask? Well, a FinOps ambassador is every person or role in the team who drives the FinOps cultural shift and makes sure that FinOps works.
To ensure the cultural change, and to maximise the probability of success for your FinOps team and the implementation of FinOps, ambassadors should have the following qualities:
- has a good understanding of the FinOps methodology;
- preferably has a FinOps practitioner certification;
- has a good understanding of company’s processes;
- good understanding of financial accountability;
- cloud architecture, cost and usage understanding;
- cares about company success and
- effectively evangelises the FinOps mindset and drives people towards the FinOps nirvana.
Once you get a taste of FinOps….
Adopting a FinOps methodology is a never-ending project for a company. Sometimes, the process doesn’t go as smoothly as planned, especially for new enterprises still trying to figure out their own business processes on top of cloud implementation and cost optimisation.
Every enterprise can pull off a successful FinOps implementation. All they need is to implement the right principles, arm themselves with the right mindset driven by a central FinOps team, and back it all up by innovative optimisation and automation tools.
Achieving all your FinOps goals is easy: combine the FinOps methodology with an unbiased central team that has ties to both engineering teams and finance teams. If you feel you still need help to get started, contact us.
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